Audit affirms IRS' response to flooded headquarters

In the wake of June's torrential rains and flooding, taxpayer data stored in the submerged basement of the IRS headquarters was sufficiently protected from unauthorized access.

In addition, unsalvageable equipment and taxpayer data were properly discarded with the approval of the National Archives and Records Administration, according to a recent audit by the Treasury Department's Inspector General for Tax Administration.

'We commend the efforts of the IRS and believe the actions taken by the IRS protected taxpayer data and minimized the disruption of computer operations caused by the flooding,' said Michael Phillips, deputy inspector general for audit.

The audit, which determined that the IRS responded responsibly to the severe weather, is the first of three reviews carried out in response to the Senate Finance Committee's request to evaluate the extent and nature of the disruption to IRS operations.

The rains of June 26 sent 20 feet of water into the IRS building's subbasement and 5 feet of water into the basement, forcing the agency out of its headquarters at 1111 Constitution Ave. in Northwest Washington, D.C., until December. IT systems were unaffected by the flooding, because they are principally kept at the IRS' suburban headquarters in New Carrollton, Md.

In response to the flooding, the IRS placed additional security guards around the building to prevent unauthorized entry. In addition, all employees entering the building's single open entrance were required to sign in and out.

But the audit also found that tracking computer assets removed from the building was not timely, and that employees removed computers from the premises without supervision.

The IRS moved 20 critical servers from the headquarters building to another IRS facility, and the Modernization and Information Technology Services (MITS) organization restored connectivity in the eight calendar days following the flooding, auditors found.

The IG also said that within two weeks of the flooding, 24 other important servers were moved and connectivity restored. In the process of transporting servers from the headquarters to other facilities between June 26 and June 29, the agency lost track of several Wage and Investment Division servers as well as many of the Criminal Investigation Division servers.

On June 30, MITS managers requested that no computer equipment be moved except under supervision and asked employees to self-report items they removed in the first few days following the flood, auditors said.

Of the 627 removed from the building, only 104 were reported retroactively. The auditors said this discrepancy could have been avoided had the system been in place and recommended that in the event of a future disaster all IRS locations implement an asset-tracking system and related processes immediately.

Despite the asset-tracking issues, Phillips complimented the IRS' response to the unexpected flooding and felt that the agency responsibly handled the security of its headquarters.

'We believe the actions taken by the IRS minimized the disruption caused by the flooding disaster,' said Phillips.